Kingdom of the Netherlands–the Netherlands:2022 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for the Kingdom of the Netherlands–the Netherlands

The Dutch economy was more resilient than its peers during and after the pandemic. Reflecting the prevalence of telecommuting and strong fiscal support, the economy experienced a less severe recession followed by a more robust recovery than in the rest of the euro area, with no scarring expected. The labor market is tight with a low unemployment rate and high vacancies, although wage growth has so far been moderate. After hitting a record high in September, consumer price inflation eased to 11 percent in December driven by lower energy prices, while core inflation increased to 8.4 percent y/y. The economy appears to be overheating. The war in Ukraine is posing new challenges albeit the terms of trade shock has been smaller than for the rest of the euro area.